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. Last Updated: 07/27/2016

Tyumenaviatrans Inks UN, Surgut Contracts

Regional air carrier Tyumenaviatrans filled its order book for 2001 and is now poised to have a second straight year of growth after a bumpy 1999 performance.

This month, the company won a multimillion-dollar contract from Surgutneftegaz for oil exploration in western Siberia. It also extended its agreement with the United Nations for a period of three months, securing a flow of $16.5 million for international contracts throughout the year, Tyumenaviatrans said in a press release.

"We benefit from both the growth of oil exploration in the region and an increase in our market share," said company spokeswoman Inessa Guseva.

The company's rise has been fueled by the oil boom that has been unfolding in western Siberia in recent years.

"It is not uncommon for oil companies to increase their share of [expensive] helicopter transportation when they earn higher profits," said Andrei Abramov, transportation analyst with NIKoil. "Otherwise they make use of less-expensive transportation methods."

Investments in the oil industry are expected to grow 120 percent to about $10 billion in 2001, according to estimates made by NIKoil.

Tyumenaviatrans' sales to its main client, Russia's No. 3 oil producer, Surgutneftegaz, doubled from $5 million in 1999 to $10 million in 2000.

This year, the oil company held a tender for a $30 million contract, according to Tyumenaviatrans. However, officials in Surgutneftegaz said the deal was worth $23 million by their estimates.

"We recently bought a number of exploration licenses in remote regions, so it is natural that we have to spend more on transportation," Surgutneftegaz spokeswoman Raisa Khodchenko said in a phone interview from Surgut, Western Siberia.

The Tyumen air carrier has benefitted from the oil boom in western Siberia.

Last year, Surgutneftegaz bought licenses for three oil fields — Zapadno-Yerginskoye, Cheprovskoye and Kondinskoye — with total oil reserves of 130 million tons. Two weeks ago, it added the Rogozhnikovskoye field, which has reserves of 128 million tons.

"All of them are located more than 400 kilometers away from our base," said Khodchenko.

Surgutneftegaz increased its capital expenditures 108 percent to $1.1 billion in 2000 and has recently mapped out plans to boost them another 20 percent to $1.3 billion in 2001.

"The fact that they secured such a flow this year is a very positive piece of news, but we will keep rating the company 'Hold,'" said Yelena Sakhnova, transportation analyst at Aton brokerage. "A lot of their contracts are short-term, so we would like to see some consistency on that side."

However, Sakhnova did not exclude the possibility that Tyumenaviatrans soon could be upgraded.

Tyumenaviatrans posted net profit of $18.1 million on sales of $59.2 million in January-September 2000 and may turn a profit of $11 million on sales of some $70 million for last year, according to Aton.

The company's stock was traded at 2.75 cents a share Monday, up 7.8 percent from Dec. 6, when the last transaction of the company took place on the Russian Trading System.

Although illiquid, Tyumenaviatrans shares rose 143 percent in 2000.

The company staged a turnaround last year after new management took the reins. In 1999, the company posted a loss of some $600,000 on sales of $40 million.